abirdman

I don’t know IIS, but I know Apache runs with a default user named (in my system) WWW-USER. That’s who has to be able to write the jpg file. The file permissions instructions basically say make the wp-content folder and everything under them world writable. At least make the jpg file you want to change world writable. Once you’re done, it’s easy enough to change it back to something more secure.

What I found, and haven’t seen documented here, is in order to make changing the header gradient work PHP requires the GD library be available and the standard script memory setting needs to be increased by quite a bit. Check out the PHP documentation here. I set my memory_limit in php.ini to 256M, though I’m going to set it back down now that the jpg is fixed.

If the permissions are right, the PHP5-GD library is installed, and there’s enough memory available, the configuration routine to change the gradient on the default theme works fine.

I had the same problem, trying to change the colors in the gradient page header in the default theme, and here’s how I solved it:
(first my setup:
OS: Ubuntu jeOS 8.04.1 (virtual machine minimal install), Webserver: Apache 2.2.8, PHP: 5.2.4)

1. PHP5 must include the GD library. I downloaded and installed into Ubuntu with sudo apt-get install php5-gd It was not available by default.
2. The jpg file (MichaelH is correct about the location of the file in his post above this one) has to be world writable, or at least writable by the Apache user (on my machine that’s www-user). The easiest way to do that is follow the official directions in the detailed instructions on permissions here. What I did was, from the console change to the blog root directory and type chmod -Rv 0777 ./wp-content I do not believe this constitutes a security risk, but if you’re worried, change the permissions back to 0755 after you’ve changed the jpg.
3. The standard install of PHP5 defaults to 16M of memory for scripts. To change the header jpg, I set the memory to 256M in php.ini.memory_limit = 256M Note that I didn’t test too finely, but 128MB did not seem to work. I am going to change the memory back to a more sane amount now that the jpg has been modified.
4. Restart Apache and you’re good to go.

I have no idea how those steps would be accomplished with a hosting provider, but that’s what I had to do with a default installation of Ubuntu 8.04 JeOS (that’s the virtual server minimal installation). I hope this helps someone. I see by searching the forums here this is not an isolated problem. It would be good if somewhere WP indicated that the GD libraries are required and that the standard script memory setting is too low.

Good luck!